Opinion: Your Uni Fees Aren’t That Expensive

Daniel Archibald illustrates the difference between university fees in Australia and the US, arguing that Australian students enjoy a far more affordable tertiary education than Americans.

This article was first published in our 2018 print edition.

I often hear students (I’m talking to you, socialist activists) complain about how expensive university fees are and how they are unaffordable. I often laugh off this claim, because if these students truly knew what an expensive tertiary education looked like, they would probably become comatose. Australia has some of the most affordable and egalitarian university fee schemes in the developed world. On the contrary, the United States tertiary tuition cost is the epitome of unaffordable. As someone who has spent most of their life in the United States, I know a thing or two about American universities. But don’t just listen to what I have to say, look at the numbers.

The scenario for these figures will be the average situation for university students in Australia and the US. Australian figures will reflect students that live at home and commute. US figures will reflect students who live in on campus student housing. All amounts are in Australian Dollars.

UWA has rather reasonably priced tuition. For simplification I will examine only the cost of a Bachelor of Arts degree for a domestic student. Again, all amounts are in AUD. At UWA the typical fee range is listed as $6,444-$10,754 per year. This gives a range for total cost of $19,332-$32,262 for a three-year degree. If you are unable to pay for this out of pocket you can defer this tuition via the government’s student loan HECS-HELP. When you achieve an income of $55,874 per year you will then have to start repaying your student loan. This repayment threshold changes each year and the threshold examined will be for 2017-18. With an income range of $55,874-$62,238 the government takes 4% of your income to pay your student debt. This means that if your income is $55,874 per year you would pay only $2,234.96(AUD) per year. A measly $186.25 per month of your $4,656.16 monthly income. A far cry from unaffordable. Moreover, there is no real interest. The total debt amount will only be indexed yearly to reflect changes in the Consumer Price Index.

Now let’s go on an odyssey of income inequality and crushing student debt, and examine the tuition cost of a state-funded public university in the US. The cost examined is in AUD at a rough conversion rate and does not include student housing costs; something that most US students pay. Ohio State University is a large, state-funded, and moderately prestigious university. Tuition for state residents is around $15,000 per year. Meaning that the total cost for a four-year Bachelor of Arts degree is $60,000. For out-of-state residents this number is tripled. This means that if you are unfortunate enough to live in a state with poor quality public universities, you are forced to either stay and receive a subpar degree or go elsewhere are face a $180,000 total cost.

If you are unable to pay the excessive fees out of pocket, there are some student loan options available. If you are lucky enough, or needy enough, to get a direct subsidised loan from the US government then you can take a yearly max of $7691.20 per year. The perks are that the government pays your loan interest while studying and for 6 months after graduation. If you get a direct unsubisidised loan you can take a yearly max of $28,667.20. However, this comes with a 5.04% interest rate for undergrads which must be paid immediately.

If you can’t get a government loan, then you can pay a visit to good ole Sallie Mae. Sallie Mae used to be a government operation that provided student loans; now, it is a private corporation. Private loans are often more expensive than government loans. For undergrads you can take as much money as needed but you face a variable interest rate of anywhere between 4.12%-10.98% APR and a fixed interest rate range of 5.74%-11.85% APR.

To pay for education in America you’re going to have to put your American dream on pause and maybe sell a kidney. For comparison, the total cost of a Bachelor of Arts degree from an Australian university will set you back $32,262. The same degree from a US university will cost you $60,000 if you live at home and $129,547 if you live in student housing, like most students do. That means at the base price there is a difference of $27,738. If you consider what university really costs American students that difference jumps to $97,285. Not to mention the variation in in-state and out-of-state costs, and the fact that this doesn’t even consider loan costs, school supplies, entertainment, etc.

So, next time you become angry about how expensive uni is, be thankful that you have HECS and don’t have to pay more than $50k for an entire tertiary education. Somewhere, thousands of kilometres away, an American uni student cries themselves to sleep because they are utterly crushed by tuition payments. The biggest thing worth crying over at UWA is the arduous trek to the Business School.